Experts suggest concrete action plan to overcome economic challenges

By Ashok Adhikari,Kathmandu, Dec. 10: Natural effects of the recession witnessed in the world economy have also started affecting Nepal. Experts have suggested that the country should proceed with concrete action plans and strategies to minimise and overcome the challenges seen in the economy.

They have pointed out the need for effective democratic leadership and liberal policies to improve the troubled economy.According to them, the end of the complex political transition and formation of the coalition government had saved the economy from further exposure to risks. 

Although the natural effects of the global economic recession are visible, experts have said that Nepal's economy is not in crisis as it is being rumoured. Even though the government is trying to save the economy, experts have said that due to the recession in the world economy and external dependence, expected results are not coming.

They have opined that the government should take a leading role to stabilise the interest rate by arranging funds in the economy from possible sources in order to reactivate the economy.

Global economy should improve

Udaya Shumsher Rana Former Minister of State for Finance

We need to do some serious homework immediately to save the economy. We are not in a crisis as rumoured, the economic recession is a global phenomenon. Nepal is facing its natural effects. This is not a problem caused by government policies or leadership. With the improvement in the world economy, positive impacts on Nepali economy will be visible as well. 

Now there are some problems not only in Nepal but also in the economy of the entire world. We can look at it from three perspectives --international, regional and national economy. As the global financial markets are inter-connected, our economy cannot survive alone. 

Now the liquidity situation has improved but there are still some challenges in the banking sector. Inflation has gone up. The Russia-Ukraine war has also created fuel and food crisis across the globe. Meanwhile, the COVID-19 pandemic has also affected China's economy. It is not possible to reform Nepali economy without the improvement in the world economy.

Due to the impact of COVID-19, we mobilised loans at a low interest rate. Now the interest rate has increased. However, foreign exchange reserves look good and there is no need to panic. 

But the government should work to increase revenue collection. Dependence on import revenue should be reduced. Revenue must be increased through taxes and financial discipline must be maintained. 

Economy needs paradigm shift

Arun Subedi

Foreign Affairs Advisor to the Prime Minister

There was a huge political and constitutional crisis when the current government was being formed. There was an economic crisis due to the outbreak of the COVID-19 pandemic all over the world. Likewise, the Russian invasion of Ukraine brought another crisis when food and fuel prices rose. 

African nations were in crisis while Sri Lanka faced an economic disaster. 

Despite this, foreign exchange reserves in Nepal are in a position to cover imports for seven months. 

The government has successfully conducted the elections of all three levels even during such a crisis has managed to stay in the economic course. This is an important achievement of the government. 

When the world is in economic crisis, the country should try to find original solution locally.

Adopting the liberal economic principles, the problems of the banking system should be removed. The government's attention should be focused on attracting international investment and making the economy more dynamic. 

Likewise, we need to attract more foreign direct investment. Our economy needs a huge paradigm shift. 

Interest rate needs to be stabilised

Vishwa Paudel

Former Vice Chairman of National Planning Commission